Euro summit rescue dealFull text of the final
declaration of the 17 euro-zone countries regarding the rescue plan for
Greece of July 21, 2011
Article added on July 22, 2011

Full text of the final declaration of the Euro Summit of
July 21, 2011. The Greece rescue deal of the 17 euro-zone member countries
(check also our German article):

We reaffirm our commitment to the euro and to do whatever is needed to
ensure the financial stability of the euro area as a whole and its Member
States. We also reaffirm our determination to reinforce convergence,
competitiveness and governance in the euro area. Since the beginning of the
sovereign debt crisis, important measures have been taken to stabilize the
euro area, reform the rules and develop new stabilization tools.

The recovery in the euro area is well on track and the euro
is based on sound economic fundamentals. But the challenges at hand have
shown the need for more far reaching measures.

Today, we agreed on the following
measures:

Greece:

1. We welcome the measures undertaken by
the Greek government to stabilize public finances and reform the economy as
well as the new package of measures including privatisation recently adopted
by the Greek Parliament.

These are unprecedented, but necessary,
efforts to bring the Greek economy back on a sustainable growth path. We are
conscious of the efforts that the adjustment measures entail for the Greek
citizens, and are convinced that these sacrifices are indispensable for
economic recovery and will contribute to the future stability and welfare of
the country.

2. We agree to support a new programme for
Greece and, together with the IMF and the voluntary contribution of the
private sector, to fully cover the financing gap. The total official
financing will amount to an estimated 109 billion euro.

This programme will be designed, notably
through lower interest rates and extended maturities, to decisively improve
the debt sustainability and refinancing profile of Greece. We call on the
IMF to continue to contribute to the financing of the new Greek programme.
We intend to use the EFSF as the financing vehicle for the next
disbursement. We will monitor very closely the strict implementation of the
programme based on the regular assessment by the Commission in liaison with
the ECB and the IMF.

3. We have decided to lengthen the
maturity of future EFSF loans to Greece to the maximum extent possible from
the current 7.5 years to a minimum of 15 years and up to 30 years with a
grace period of 10 years. In this context, we will ensure adequate post
programme monitoring. We will provide EFSF loans at lending rates equivalent
to those of the Balance of Payments facility (currently approx. 3.5
percent), close to, without going below, the EFSF funding cost. We also
decided to extend substantially the maturities of the existing Greek
facility. This will be accompanied by a mechanism which ensures appropriate
incentives to implement the programme.

4. We call for a comprehensive strategy
for growth and investment in Greece. We welcome the Commission's decision to
create a Task Force which will work with the Greek authorities to target the
structural funds on competitiveness and growth, job creation and training.
We will mobilise EU funds and institutions such as the EIB towards this goal
and relaunch the Greek economy. Member States and the Commission will
immediately mobilize all resources necessary in order to provide exceptional
technical assistance to help Greece implement its reforms. The Commission
will report on progress in this respect in October.

5. The financial sector has indicated its
willingness to support Greece on a voluntary basis through a menu of options
further strengthening overall sustainability. The net contribution of the
private sector is estimated at 37 billion euro. Credit enhancement will be
provided to underpin the quality of collateral so as to allow its continued
use for access to Eurosystem liquidity operations by Greek banks. We will
provide adequate resources to recapitalise Greek banks if needed.

Private sector involvement:

6. As far as our general approach to
private sector involvement in the euro area is concerned, we would like to
make it clear that Greece requires an exceptional and unique solution.

7. All other euro countries solemnly
reaffirm their inflexible determination to honour fully their own individual
sovereign signature and all their commitments to sustainable fiscal
conditions and structural reforms. The euro area Heads of State or
Government fully support this determination as the credibility of all their
sovereign signatures is a decisive element for ensuring financial stability
in the euro area as a whole.

Stabilisation tools:

8. To improve the effectiveness of the
EFSF and of the ESM and address contagion, we agree to increase their
flexibility linked to appropriate conditionality, allowing them to: -- act
on the basis of a precautionary programme; -- finance recapitalisation of
financial institutions through loans to governments including in non
programme countries; -- intervene in the secondary markets on the basis of
an ECB analysis recognizing the existence of exceptional financial market
circumstances and risks to financial stability and on the basis of a
decision by mutual agreement of the EFSF/ESM Member States, to avoid
contagion.We will initiate the necessary procedures for the implementation
of these decisions as soon as possible.

9. Where appropriate, a collateral
arrangement will be put in place so as to cover the risk arising to euro
area Member States from their guarantees to the EFSF. Fiscal consolidation
and growth in the euro area: 10. We are determined to continue to provide
support to countries under programmes until they have regained market
access, provided they successfully implement those programmes. We welcome
Ireland and Portugal's resolve to strictly implement their programmes and
reiterate our strong commitment to the success of these programmes. The EFSF
lending rates and maturities we agreed upon for Greece will be applied also
for Portugal and Ireland. In this context, we note Ireland's willingness to
participate constructively in the discussions on the Common Consolidated
Corporate Tax Base draft directive (CCCTB) and in the structured discussions
on tax policy issues in the framework of the Euro+ Pact framework.

11. All euro area Member States will
adhere strictly to the agreed fiscal targets, improve competitiveness and
address macro-economic imbalances. Public deficits in all countries except
those under a programme will be brought below 3 percent by 2013 at the
latest. In this context, we welcome the budgetary package recently presented
by the Italian government which will enable it to bring the deficit below 3
percent in 2012 and to achieve balance budget in 2014. We also welcome the
ambitious reforms undertaken by Spain in the fiscal, financial and
structural area. As a follow up to the results of bank stress tests, Member
States will provide backstops to banks as appropriate.

12. We will implement the recommendations
adopted in June for reforms that will enhance our growth. We invite the
Commission and the EIB to enhance the synergies between loan programmes and
EU funds in all countries under EU/IMF assistance. We support all efforts to
improve their capacity to absorb EU funds in order to stimulate growth and
employment, including through a temporary increase in co-financing rates.

Economic governance:

13. We call for the rapid finalization of
the legislative package on the strengthening of the Stability and Growth
Pact and the new macro economic surveillance. Euro area members will fully
support the Polish Presidency in order to reach agreement with the European
Parliament on voting rules in the preventive arm of the Pact.

14. We commit to introduce by the end of
2012 national fiscal frameworks as foreseen in the fiscal frameworks
directive.

15. We agree that reliance on external
credit ratings in the EU regulatory framework should be reduced, taking into
account the Commission's recent proposals in that direction, and we look
forward to the Commission proposals on credit ratings agencies.

16. We invite the President of the
European Council, in close consultation with the President of the Commission
and the President of the Eurogroup, to make concrete proposals by October on
how to improve working methods and enhance crisis management in the euro
area.